Suppose there are two countries and two goods- Country S Country F 10 labor hrs/unit of output Grapes Honey 12 5 a. Which country has an absolute advantage in grapes? In honey? b. Can the countries specialize according to absolute advantage? Why? If not, can they specialize on the basis of comparative advantage? If so, c. Specify the directions of comparative advantage. d. What are the per unit of output gains/losses from specialization in this case? why?

Suppose there are two countries and two goods- Country S Country F 10 labor hrs/unit of output Grapes Honey 12 5 a. Which country has an absolute advantage in grapes? In honey? b. Can the countries specialize according to absolute advantage? Why? If not, can they specialize on the basis of comparative advantage? If so, c. Specify the directions of comparative advantage. d. What are the per unit of output gains/losses from specialization in this case? why?

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Description: Answer all 4 part I will give 4 like from different different account Suppose there are two countries and two goods-Country SCountry F10 labor hrs/unit of outputGrapesHoney125a. Which country has an absolute advantage in grapes? In honey?b. Can the c

Brief Principles of Macroeconomics (MindTap Course List)

8th Edition

ISBN:9781337091985

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter3: Interdependence And The Gains Rrom Trade

Section: Chapter Questions

Problem 4CQQ

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In Japan, one worker can make 5 tons of rubber or 80 radios. In Malaysia, one worker can make 10 tons of rubber or 40 radios. Who has the absolute advantage in the production of rubber or radios? How can you tell? Calculate the opportunity cost of producing 80 additional radios in Japan and in Malaysia. (Your calculation may involve fractions, which is fine,) Which country has a comparative advantage in the production of radios? Calculate the opportunity cost of producing 10 additional tons of rubber in Japan and in Malaysia. Which country has a comparative advantage in producing rubber? In this example, does each country have an absolute advantage and a comparative advantage in the same good? In what product should Japan specialize? In what product should Malaysia specialize?
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